First six months of 2011: Linde again achieves double-digit growth in sales and earnings
(Thomson Reuters ONE) -
Linde AG /
First six months of 2011: Linde again achieves double-digit growth in sales and
earnings
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* Group sales grow 11.0 percent to EUR 6.774 bn
* Group operating profit* up 11.7 percent to EUR 1.559 bn
* Group operating margin rises to 23.0 percent (2010: 22.9 percent)
* Increase in earnings per share from EUR 2.63 to EUR 3.32
* Outlook for 2011 confirmed:
* Group: growth in sales and earnings
* Gases Division: sales growth and earnings increasing at a faster rate
than sales
* Engineering Division: sales constant, operating margin of at least 10
percent
Munich, 29 July 2011 - The technology company The Linde Group continued to
achieve profitable growth in the first half of 2011. "We are well on our way,"
said Professor Dr Wolfgang Reitzle, Chief Executive Officer of Linde AG. "We've
seen a strengthening of demand in both our gases business and our engineering
business worldwide." Reitzle is also confident about the coming months: "We will
continue to benefit from the growth areas energy and health and from
consistently dynamic trends in the emerging economies, especially in Asia. We
confirm our outlook and expect to achieve growth in Group sales and Group
operating profit in the 2011 financial year compared with the prior year."
In the first half of 2011, Group sales rose by 11.0 percent to EUR 6.774 bn,
compared with sales in the first half of 2010 of EUR 6.104 bn. After adjusting
for exchange rate effects, the increase in sales was 10.3 percent. Linde is
continuing the rigorous implementation of its HPO (High Performance
Organisation) programme, a holistic concept for sustainable process optimisation
and productivity gains, and increased Group operating profit* by 11.7 percent to
EUR 1.559 bn (2010: EUR 1.396 bn). The Group operating margin rose to 23.0
percent (2010: 22.9 percent).
Earnings before taxes on income (EBT) climbed to EUR 792 m, exceeding the
comparable prior-year figure of EUR 646 m by 22.6 percent. Earnings after tax
rose 23.8 percent to EUR 598 m (2010: EUR 483 m). After adjusting for non-
controlling interests, earnings attributable to Linde AG shareholders were EUR
566 m (2010: EUR 445 m). Earnings per share increased as a result by 26.2
percent to EUR 3.32 (2010: EUR 2.63). On an adjusted basis, i.e. after adjusting
for the effects of the purchase price allocation from the BOC acquisition,
earnings per share stood at EUR 3.79 (2010: EUR 3.15).
Gases Division
During the reporting period, the general economic recovery also fuelled demand
for gases worldwide. Linde was able to benefit from this positive trend in all
product areas, due to the Group's global footprint and its strong market
position in the emerging economies.
Sales in the Gases Division in the first six months of 2011 grew 10.2 percent to
EUR 5.436 bn, compared with sales in the first six months of 2010 of EUR 4.931
bn. On a comparable basis, i.e. after adjusting for exchange rate effects,
changes in the price of natural gas and changes to Group structure, the increase
in sales was 8.5 percent.
Operating profit in the Gases Division rose 10.9 percent to EUR 1.483 bn (2010:
EUR 1.337 bn). One of the factors contributing to the increase was the strict
implementation of Linde's HPO measures. The operating margin rose to 27.3
percent, exceeding the high figure achieved in the first six months of 2010 of
27.1 percent.
Business trends in the individual operating segments of the Gases Division make
it clear that the pace of economic recovery still varies from region to region.
In the first six months of 2011, the highest growth rates were once again to be
seen in the emerging economies of Asia, especially China, and in South America.
At the same time, the economic recovery continued in the more mature markets
such as the US and Western Europe.
In the EMEA operating segment (Europe, Middle East and Africa), Linde achieved
sales growth of 8.1 percent in the first half of 2011 to EUR 2.824 bn (2010: EUR
2.613 bn). On a comparable basis, the growth in sales was 5.9 percent. Operating
profit again increased at a faster rate than sales, rising 9.5 percent to EUR
807 m (2010: EUR 737 m). This resulted in an operating margin of 28.6 percent
(2010: 28.2 percent). Here too, the rigorous implementation of the various
productivity improvement and process standardisation initiatives under the HPO
programme made a positive contribution.
Linde achieved a double-digit growth rate in the Asia/Pacific operating segment
due to continued economic dynamism in Asia and its leading position in those
markets. In the first six months of 2011, sales in this region grew 17.5 percent
to EUR 1.473 bn (2010: EUR 1.254 bn). On a comparable basis, the increase in
sales was 11.2 percent. Operating profit rose by 15.3 percent to EUR 406 m
(2010: EUR 352 m). The operating margin for the six months to 30 June 2011 was
27.6 percent (2010: 28.1 percent). When comparing the operating margin for the
first half of 2011 with that for the first half of 2010, factors to be taken
into account are the pass-through of increases in the price of natural gas and
the preliminary investment required for infrastructure expansion and the
employment of new staff in the dynamic Chinese market. To sustain steady
profitability, Linde is continuing here too with the rigorous implementation of
the HPO concept.
In the Americas operating segment, sales in the first half of 2011 grew 7.1
percent to EUR 1.173 bn (2010: EUR 1.095 bn). On a comparable basis, the
increase in sales was higher, at 11.8 percent. Operating profit improved by 8.9
percent to EUR 270 m (2010: EUR 248 m). Factors contributing to this increase in
earnings, apart from higher volumes, were the progress made by Linde in the
implementation of HPO and positive one-off effects in the first quarter of
2011. The operating margin rose to 23.0 percent (2010: 22.6 percent).
The performance in the individual product areas reflects the overall positive
trend in the Gases Division. The highest rate of growth was in the on-site
business, where Linde supplies gases on site to major customers. Boosted by the
continuous ramp-up of plants which came on stream in the third and fourth
quarters of 2010 and by the start-up of new plants, sales in this product area
rose on a comparable basis by 11.4 percent to EUR 1.331 bn (2010: EUR 1.195 bn).
The upward trend in Linde's liquefied gases and cylinder gas business continued
to accelerate. Cylinder gas sales grew 8.0 percent to EUR 2.224 bn (2010: EUR
2.060 bn). Sales of liquefied gases in the first six months of 2011 increased by
7.8 percent to EUR 1.297 bn (2010: EUR 1.203 bn). The Healthcare product area
(the medical gases business and related maintenance and advisory services) again
saw steady growth, achieving sales of EUR 584 m, an increase of 5.4 percent over
the figure for the first half of 2010 of EUR 554 m.
Gases Division - Outlook
Linde remains committed to its original target in the gases business of growing
at a faster pace than the market and continuing to improve productivity. In the
on-site business, Linde has a full project pipeline which will make a
significant contribution to sales and earnings in the 2011 financial year. The
liquefied gases and cylinder gas business is set to benefit from the ongoing
economic recovery. Linde expects positive business trends in the Healthcare
product area to continue, with a higher rate of sales growth than in 2010.
Against this background, Linde anticipates that sales generated by the Gases
Division in the 2011 financial year will exceed sales achieved in 2010 and that
operating profit will grow at a faster pace than sales.
Engineering Division
The market environment in the international large-scale engineering business
continued to stabilise in the course of the first half of 2011.
Sales in the Engineering Division in the first six months of 2011 increased by
12.0 percent to EUR 1.226 bn (2010: EUR 1.095 bn). The continuing successful
execution of a number of individual projects meant that operating profit grew at
a faster rate than sales, rising 14.6 percent to EUR 141 m (2010: EUR 123 m).
The operating margin was 11.5 percent (2010: 11.2 percent).
Order intake in the first half of 2011 was EUR 1.149 bn, 19.4 percent above the
figure for the first half of 2010 of EUR 962 m. In the second quarter of 2011,
two major orders from China and Indonesia had a significant impact on order
intake. The first of these orders, to supply a hydrogen and synthesis gas plant
commissioned by Linde's Gases Division in the Chongqing Chemical Park, was worth
around EUR 200 m. The second order, worth EUR 88 m, was for Linde to build an
air separation plant to supply gases to the steel company PTKP in Indonesia.
In addition to these major orders, order intake was characterised by a number of
small and medium-sized new orders, as in previous quarters. Linde's order
backlog remains high. At 30 June 2011, it stood at EUR 3.763 bn (31 December
2010: EUR 3.965 bn).
Together with its project partner SBM Offshore (Netherlands), Linde's
Engineering Division entered into a cooperation agreement during the reporting
period with the Thai oil group PTT (Petroleum Authority of Thailand) to develop
a floating natural gas liquefaction plant in the Timor Sea off the northern
coast of Australia. The project will involve the conversion of natural gas from
three gas fields into LNG (Liquefied Natural Gas). If the gas reserves meet
expectations, the project will move into the front-end engineering and design
phases by the end of 2011. The final investment decision would be made at the
end of 2012. Commercial production would be expected to commence at the end of
2016.
Engineering Division - Outlook
The high order backlog provides a good basis for a solid business performance in
the Engineering Division over the next two years. Linde expects to achieve the
same level of sales in its engineering business in the 2011 financial year as in
2010. Given the positive trends in the first half of the year, the Group expects
to achieve an operating margin in the current financial year of at least 10
percent. In the medium term, the target for the operating margin continues to be
8 percent.
Linde is well-positioned in the market for olefin plants, natural gas plants,
air separation plants and hydrogen and synthesis gas plants and will derive
lasting benefit in particular from investment in the two structural growth
areas: energy and the environment.
To coincide with the publication of the quarterly financial statements, a
teleconference for analysts will take place today at 2pm (German time) in
English with Georg Denoke, CFO of Linde AG. Journalists will have the
opportunity to listen to the conference live by dialling +49.69.589.99-0509.
Please give the reference number 894634 and tell the operator your name and the
name of your company. Following the teleconference, you will be able to hear a
recording of the event by calling +49.30.726.16-7224. Please give the reference
number 894634.
The Linde Group is a world-leading gases and engineering company with around
49,100 employees working in more than 100 countries worldwide. In the 2010
financial year, it achieved sales of EUR 12.868 bn. The strategy of The Linde
Group is geared towards sustainable earnings-based growth and focuses on the
expansion of its international business with forward-looking products and
services. Linde acts responsibly towards its shareholders, business partners,
employees, society and the environment - in every one of its business areas,
regions and locations across the globe. Linde is committed to technologies and
products that unite the goals of customer value and sustainable development.
*Operating profit: EBITDA including share of net income from associates and
joint ventures.
For more information, see The Linde Group online athttp://www.linde.com
Further information:
Media Investor Relations
Uwe Wolfinger Dr Dominik Heger
Telephone: +49.89.35757-1320 Telephone: +49.89.35757-1334
Matthias Dachwald Thomas Eisenlohr
Telephone: +49.89.35757-1333 Telephone: +49.89.35757-1330
--- End of Message ---
Linde AG
Klosterhofstrasse 1 Munich Germany
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Press Release as PDF:
http://hugin.info/125064/R/1534470/467699.pdf
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Unternehmensinformation / Kurzprofil:
Datum: 29.07.2011 - 07:32 Uhr
Sprache: Deutsch
News-ID 56825
Anzahl Zeichen: 14876
contact information:
Town:
Munich
Kategorie:
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